A High-Risk, High Reward Biotech Play

Ah, the "golden age of biotech" — remember when that was the phrase du jour? Well, it might not be on everyone’s lips these days, but let me tell you, the biotech arena still holds some golden tickets for those with an eye for long-term gems.

These hotbeds of innovation aren’t just cooking up your everyday aspirin; they’re on the front lines battling the big beasts like rare diseases and crafting cures that might have seemed like sci-fi a few decades ago.

So, why should we keep our wallets ready for biotech? Simple: life-saving meds aren't exactly impulse buys at the checkout counter. People need these drugs, economy be darned. And that, my friends, brings us to a biotech belle of the ball: Crispr Therapeutics (CRSP).

Now, if you’re hunting for the disruptors of the disruptors, cast your eyes on CRISPR/Cas9 gene-editing technology. And leading the charge?  Crispr Therapeutics, of course.  Their new FDA-approved therapy, Casgevy?  Think of it as a microscopic search-and-replace function for your genes, pinpointing the exact spot that needs fixing. Snipping out a faulty gene? Child's play for CRISPR.

This isn't just about editing genes willy-nilly. This technology, honed and shepherded through the halls of academia, now bears the fruit of a Nobel Prize in Chemistry in 2020 — a tip of the hat to one of CRISPR Therapeutics’ founders, Charpentier.

With exclusive rights to this CRISPR/Cas9 tech, they’re not just playing in the minor leagues; they’re major league players with the FDA-approved Casgevy aimed at tackling sickle cell disease (SCD).

If you’re feeling more cautious, however, then Vertex Pharmaceuticals (VRTX) might be a steadier ride. It’s a bigger boat with more therapies on the market.

But if you’re feeling a bit more Maverick, a direct bet on Crispr Therapeutics could be your kind of play. Smaller in size, sure, but with a direct line to the gains (or pains) from Casgevy, and boy, does biotech love a high stakes game.

So, what does throwing your chips in with CRISPR entail? Let's unwrap this.

First off, their Casgevy is a pioneering ex vivo CRISPR-Cas9 therapy—think of it as a pit stop where cells are tuned up outside the body before being put back in the race. It’s already got the green light from the FDA for not one, but two heavy hitters: sickle cell disease and transfusion-dependent beta-thalassemia (TDT).

But here’s the rub: despite these big wins, CRISPR’s stock has been more or less jogging in place for five years. Why? It seems the market’s giving the side-eye to the commercial rollout of these therapies. But hold up—shouldn’t the stock be climbing as these treatments start to hit the market?

Well, the game here is more marathon than sprint. We're talking about a potential addressable market for these treatments that’s just aching to be tapped into. But there’s a catch—the price tag is a whopper at $2.2 million a pop. That’s a lot of zeroes.

Now, let’s do some napkin math.

If CRISPR could corner the market on all SCD and TDT patients across the US and EU, we're looking at a ballpark figure of around $38.6 billion in potential revenue. And here's the kicker: the real puzzle is figuring out how many of these folks will actually get treated with Casgevy, given the steep costs and varied insurance landscapes.

Yet, if CRISPR can snag just a slice of this market, even with a high discount rate factored in for all the risk, the numbers start to look pretty tasty.

Imagine if they treated all these patients over a decade—ka-ching! That’s an NPV (net present value) that could potentially justify CRISPR’s current market cap all on its own.

Overall, investing in CRISPR Therapeutics could be akin to buying a stake in Genentech (DNA) back in the day—before they hit the biotech jackpot.

With Casgevy already approved and more potential blockbusters in the pipeline, CRISPR isn't just about today’s gains; it’s about betting on a biotech future that could be as revolutionary as the invention of the wheel—if the wheel could edit your DNA, that is.

What’s the verdict then? If you’re game for a ride on the wild side of biotech with a company that’s rewriting the genetic code of healthcare, CRISPR Therapeutics might just be the stock to watch. So buckle up because it’s going to be an exciting ride.